CIA-adjacent VC community convenes in Boston during ice storm
Beyond standard calls for cutting Pentagon contracting red tape, pitches included a former CIA station chief's LLM benchmark and micro nuclear reactors for fueling US military bases and mining crypto.
With an ice storm blanketing much of the northeastern United States, the author’s twelve hour drive to and from Boston from Philadelphia on Thursday was perhaps inadvisable — resulting in their vehicle locking up and skidding for seconds at a time on numerous occasions on a route that included cars and semi-trucks spun out into the snow. But willingly cancelling attendance of an AI-focused venture capital summit with three CIA-station-chiefs-turned-technologists as speakers would be defeat for this publication.
Sponsored by the British weapons manufacturing giant BAE Systems, the third iteration of the annual event opened at 1:30 p.m. in downtown Boston with remarks from New North Ventures general partner Jeremy Hitchcock: “Super excited to have a discussion around dual-use, resiliency, maritime, cyber, building companies [as well as] making the world a better and safer place, and be[ing] capitalists at the same time.” “Apparently you can do both,” he added, as the audience laughed.
(The co-founders of the Silicon Valley branch of the Defense Innovation Unit, Raj Shah and Christopher Kirchhoff, similarly argued in their 2024 book “Unit X” that Shah’s venture capital firm Shield Capital was “a way to make money, yes, but also to preserve democracy.” “It’s absolutely possible to do well by doing good,” they added.)
Many readers likely associate the intersection of the CIA and venture capital with In-Q-Tel, a 501(c)(3) nonprofit which has operated for roughly 25 years on behalf of the U.S. Intelligence Community and whose original CEO, Gilman Louie, now leads a newer, billionaire-backed analogue known as America’s Frontier Fund. But In-Q-Tel — or, “IQT,” as it is frequently shortened — contributed just one of the nearly thirty speakers at New North Ventures’ Boston Innovation Summit on Thursday, which was subtitled “Securing Our Future.”
Operating out of Manchester, New Hampshire since August 2019 with the prominent satellite-based radio-emission monitoring company HawkEye 360 in its portfolio, New North’s primary name recognition derives from venture partners Kevin L. Riggins, a principal at WestExec Advisors who was previously chief of staff to CIA director William Burns, and Suzanne Kelly, the CEO of the highly-networked Cipher Brief newsletter who was previously a CNN executive producer.
Kelly moderated the first panel of Thursday’s event, entitled “Financing Dual-Use Tech,” which included IQT executive vice president Sarah Sewall as one of its four panelists. Beyond Ms. Sewall noting the intriguing trend of increased defense tech investment from foundations and family investment offices — including attendee Chasella Capital, which invested in Fermata Discovery alongside New North — the panel concluded with a brief discussion of the opportunity raised by China’s recent “DeepSeek” competitor to U.S. Large Language Model (LLM) companies such as OpenAI and Anthropic.
After Ms. Sewall argued that Americans have a history of shining in times of crisis, Ms. Kelly responded that, “I think DeepSeek was a great example of that. It was initially the ‘oh shit’ moment of ‘what’s happened and how are you going to recover from this,’ to a couple of days later having a more thoughtful look at the opportunities presented by it, how it’s changing the landscape, and being a bit more sober about the approach.”
In contrast to such “sober” responses, U.S. Senator Josh Hawley (R-MO) recently proposed legislation to prosecute U.S. citizens who download or make use of DeepSeek.
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New North’s five hour meeting in Boston sandwiched a fifteen minute lighting round of six defense tech business pitches into a rapid-fire succession of five panels, with many audience questions — including those from the author — being left unanswered.
The theme of the opening fireside chat with former CIA chief operating officer and “Intelligence Matters” podcast co-host Andrew Makridis was undoubtedly optimism, with Makridis stating that “I don’t buy the ten foot tall China,” and that no country could compete with us if we “unleashed” even 10% of the capabilities of our venture capital markets. Makridis also made a point of namedropping his relationship with billionaire investor Marc Andreessen, whom he publicly interviewed early last year, emphasizing Andreessen’s perspective that only optimists survive in Silicon Valley.
Movie references abounded in other panels, with Defense Innovation Unit senior advisor and former CIA Latin America operations chief Duyane Norman quoting from Jack Nicholson’s climactic performance in the 1992 movie “A Few Good Men” and arguing that Facebook has a responsibility to counter the disinformation produced on its platform rather than assuming that member of the government, whom he described as “on the wall,” would protect the country. On a lighter note, Mr. Hitchcock noted to a cybersecurity panel that, on the subject of beneficial paranoia, much of the technology discussed within Will Smith and Gene Hackman’s 1998 film “Enemy of the State” is now real.
According to Arthur Holland Michel’s 2019 book “Eyes in the Sky,” the U.S. high-resolution drone surveillance program, technically known as Wide-Area Motion Imagery (WAMI) and often collected from General Atomics MQ-9 Reaper drones, and which inspired the creation of Project Maven due to the sheer volume of imagery, was the result of a Lawrence Livermore National Laboratory engineer watching “Enemy of the State” and deciding to make the concept a reality. Similarly, the CIA’s pursuit of facial recognition technology during the Reagan administration was inspired by director William Casey watching the 1985 James Bond film “A View to a Kill,” where the villainous Silicon Valley investor “Max Zorin” played by Christopher Walken covertly unrolled James Bond’s cover using primitive facial recognition.
Despite what IQT’s Sewall described as the U.S. Government’s “lip service” for AI adoption, she argued that the reality can be quite different, causing tension and disappointment from both the government and potential contractors. Fellow panelist Mark Morisette of North Atlantic Capital thus argued that advanced manufacturing has a better value proposition right now than artificial intelligence.
In one telling example during the third panel, “Rapid innovation in the [U.S. Navy] through the lens of the Red Sea conflict,” discussion by Blue Water Autonomy founder Austin Gray regarding the Navy recently allocating $250 million for unmanned systems, Captain Ben Cipperley noted that, in the aftermath of the Hamas attacks of October 7, 2023, data collected by the Aegis Combat System was only being disseminated by FedEx shipments after being written to tape. Defense News reported software updates to Aegis in March 2024, writing that they were “for destroyers shooting down Houthi missiles and drones in the Red Sea, thanks to a team of technical experts that mined data from all the shootdown events since October.” (The Yemeni group had argued that its attacks on shipping vessels in the Red Sea were designed to impede the Israeli military’s indiscriminate mass killings of Palestinian women and children.)
Mr. Gray, whose Substack has some exclusive information on the partners of the Pentagon’s Office of Strategic Capital — including New North Ventures — noted in his intro that he was previously a Navy intelligence officer who had combatted the Houthis in the Red Sea and visited a Ukrainian drone factory. Captain Cipperley, a former fellow of the Stimson Center, is currently the director of the Strategic Actions Group of the Chief of Naval Operations.
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The second panel, moderated by Mr. Hitchcock, was dedicated to the subject of cybersecurity and was comprised of current U.S. Air Force Office of Special Investigations special agent in charge David Leslie and former U.S. Army computer network operations specialist Benjamin A. Faberlle. Mr. Faberlle recently became the founder and CEO of the cybersecurity company CrunchAtlas, which is co-located with New North and listed Mr. Hitchcock as a senior adviser in its flyer at the event.
“Where there is a threat, there is an opportunity, and so we need to take advantage of those threat vectors and see how we can flip this back around to our advantage,” argued Mr. Leslie, after calling for increased U.S. offensive cyber capabilities. “There’s multitude of ways, but different forum,” he added. “Different forum,” Mr. Hitchcock echoed.
Mr. Leslie also noted that many cyber threats of concern are technically legal, stating, “Candidly, a lot of our adversaries — and especially the more savvy ones — they know our laws better than we do … laws aren’t being broken, per say, it’s just more of an intelligence threat.”
A former CIA station chief in Cyprus and Ukraine, Edward Bogan, spent his portion of the penultimate panel — which was listed as final in the agenda — discussing the open source intelligence work he is now performing with 2430 Group to track China’s complex supply chains for acquiring advanced computer chips. According to Mr. Bogan, rather than directly purchasing the chips, China uses intermediary countries such as India, the United Arab Emirates, Kazakhstan, Uzbekistan, and Thailand.
(President Trump’s recently announced $500 billion “Stargate” AI infrastructure initiative with OpenAI closely involves the UAE’s MGX Fund, which, like its close partner Group 42, is chaired by UAE national security advisor Tahnoon bin Zayed; Microsoft president Brad Smith joined the board of Group 42 in April.)
Fellow penultimate panelist Gray Chynoweth, a U.S. Navy reservist, cracked the joke that, on the positive side of corporate incentives, “The unlimited partnership between Russia and China does not extend to not selling chips to Ukrainian drone companies.”
CIA LLM benchmarks and crypto-mining with nuclear reactors
Using the unexpected collapse of Silicon Valley Bank in March 2023 as a motivating example, Scott Weller of the financial services startup EnFi promoted his company as being able to “unlock capital markets using AI” and to help answer questions such as “What happens to our portfolio and risk if there are 25% tariffs against Mexico and Canada?” and “What happens if there is a war between China and the United States, specifically if there is an invasion of Taiwan?”
(As the author reported from Silicon Valley Bank shortly before its collapse, an employee of the aforementioned America’s Frontier Fund, a privatized analogue of IQT, told the audience that the organization had designed several of its investments to “10x overnight, like, no question about it” in the event of war in Taiwan.)
Perhaps the most high-powered startup pitch came from Alex Haro, a co-founder of the family safety application Life360, which infamously previously powered much of the commercial cellphone location-tracking industry. His new startup, Hubble Network, promises to provide satellite connectivity to every Bluetooth device and claims to have launched three satellites in the past year.
Former Second Front Systems and Overwatch Data co-founder Tad Mielnicki briefly pitched his new data fusion company LARX, stating that “At LARX, what we are doing is building the most comprehensive and advanced geospatial, drone, and remote sensing data orchestration and intelligence fusion platform,” Mr. Mielnicki stated, adding that the platform was named Orion.
More niche startup pitched also included the SCIFs-as-a-service company Nooks and the “micro nuclear reactor” company StarCube’s plan to subsidize its tennis court-sized installations on U.S. military bases with cryptocurrency mining, arguing that half of all U.S. loss of life in Afghanistan resulted from protecting fuel convoys.
Michael Widener, a former CIA station chief who subsequently led the agency’s relationship with IQT before heading the technology-focused espionage department of the Transnational and Technology Mission Center (T2MC) created during the Biden administration, promoted a proprietary LLM benchmark he created, named IObuddy. According to Widener, his expertise at the CIA positions him to serve as a sort of honest broker to speed up the agency’s LLM adoption in the face of the high barriers slowing importation of LLMs into its classified networks “up on the high side,” as well as the agency’s reticence to articulate the specifics of desired usecases to contractors and venture capitalists.
“This creates a big gap, and I think there is a clear need for a third party service,” argued Widener. “This benchmark is not saturated, which means there is still a lot of room for the top-performing models to still improve and do better,” he added. “They’re really good at typical writing summarization and triage capabilities … but they’re not yet ready to write finished analysis.”
Published results from the IObuddy benchmark currently list OpenAI’s o1 model as the overall best, though they do not yet incorporate a benchmark of what Cipher Brief’s Suzanne Kelly referred to as the “oh shit” moment of China’s open source DeepSeek model.
Editorial note: New North Ventures unexpectedly declared the event as under Chatham House rules at the start of the event, without the author agreeing. Generally speaking, journalists are only expected to abide by confidentiality rules for which they explicitly consented and — regardless — Chatham House rules are less meaningful when the participant list is already public.
Update on February 7, 2025 at 7:03 p.m. Eastern Standard Time: The discussion of the $250 million Navy allocation was corrected to refer to a broader category of unmanned systems.
The past few years I've been thinking about the old Bond movies and how so many of them villains and their schemes have come to life... and how at the end they all sacrifice their underlings in a futile attempt to escape in a mini-sub or spaceship. Christopher Walken's psychotic laugh at the end of VTAK just as he's losing his grip is epic.
Unfortunately, these past few weeks, the USA is more like the end of Scarface (1983)... with 20kgs of cocaine, a machine gun and a violent end.